Government Operations committee  I think this is critical. There is a lot of program support, whether it's SR and ED or IRAP or whatever, to bring you up to the end of the prototyping stage. That's not where the problem is. Getting those prototypes into products takes about three years of experience out in the marketplace with a few crazy customers who are going to take a chance on you.

Government Operations committee  In the CICP program itself, this idea of being able to do follow-on contracts for successful demonstrations I think would be a very good expansion to put in. The second one is not really related to CICP; it's related to export. On our side we're going to make the money on the export to other countries.

Government Operations committee  Sure. The company survived from our starting days until the middle of this year on services. That was 99% of our revenue; it is for services. We were in an intense R and D phase to take our IP and productize it. This year has been the crossover year, primarily through sales to the offshore oil and gas industry, where now product sales are surpassing our services sales.

Government Operations committee  I'll be honest with you. St. John's is at a crossroads because of the oil and gas industry. The oil and gas industry is more likely to take a chance with new technologies and new products, and they're a global industry. That is the launch pad where most Newfoundland companies are moving.

Government Operations committee  I think it still comes down to economies of scale for big companies versus small companies. Where the larger companies can have an advantage is if there are layers upon layers of due diligence, risk, bonds, or whatever, just added on top of contracts, or you bundle a bunch of smaller contracts into one super contract.

Government Operations committee  I can speak to that from our oil and gas experience, because our main competitors are all Europeans and we beat them. If they want to come to Canada, we'll beat them here. The issue, though, is a small company against a big company in a procurement system that I think heavily favours a bigger company because of the lower risk factors.

Government Operations committee  Thank you.

Government Operations committee  The first round of CICP was announced last year, in late 2010, so that's when we established our link with them.

Government Operations committee  Yes, actually. The things we have for them are a crossover from oil and gas. We perfect it in oil and gas and then we bring it over to defence and security. We've been actively pursuing both departments since 2007, with no success, really.

Government Operations committee  It's a big breakthrough, but I'm not sure if it's going to be the big breakthrough to supplying the Canadian government. Again, this is a one-shot deal. They can't use this procurement vehicle to buy multiples of the same product. They have to go back through the normal procurement process, which then puts you back to the same problem: we're a new company with new technology and we don't hit the thresholds for risk tolerance.

Government Operations committee  Yes. These are enormous procurements and fairly complicated. The key for us is to get into the supply chains of the major contractors, which we have been able to do through the Halifax class modernization, not for our products but for our services. We see that our excellent performance on the Halifax class modernization project is going to stand us in good stead for getting a seat at the table, so to speak, at the shipbuilding procurement process.

Government Operations committee  We have 20 full-time and about 40 virtual employees, plus we have about 20 associated researchers at the university who help us develop new technologies.

Government Operations committee  Yes, that's correct. For the CICP program we were accepted. This was a parallel activity that was going on through CCC, the Canadian Commercial Corporation, to accept us as a supplier. The Canadian government would then do a government-to-government transaction with a foreign government.

Government Operations committee  This came from the briefings that were given to the bidders in round one. It comes from the principle that if a consultant helps the federal government define the performance standards or the specifications for an object, this group then is barred from bidding and supplying the same object.

Government Operations committee  I can speak from the Virtual Marine Technology point of view. We've had experience in working with the federal government before, mostly through its innovation programs. We have a good idea of how to interpret what's being asked for and how to submit a compliant bid. So we were able to do this on our own.